Argentina stocks, bonds sink after market holiday

BUENOS AIRES, Nov 7 (Reuters) - Argentine stocks and bonds fell on Friday, in line with global losses from a day earlier when the Buenos Aires bourse was closed for a bank holiday.

The benchmark MerVal stocks index .MERV closed down 3.45 percent at 1,096.60, breaking a run of seven consecutive gains. It fell as much as 6.56 percent earlier in Friday’s session.

“The market was adjusting itself to get in line with the prices of American Depositary Receipts,” said Dionisio Corneille, a trader at the Corneille brokerage.

“The sharp early losses softened as Wall Street recovered and above all due to the involvement in the market of the state in the form of Nacion Bursatil,” he added. Nacion Bursatil is an investment fund managed by state-run bank Banco Nacion.

Among the MerVal’s biggest losers was index heavyweight Tenaris (TENA.BA), the world’s leading producer of seamless steel tubes for the energy industry, which fell 8.4 percent to 40.3 pesos per share.

Argentine bonds ended with an average loss of 2.7 percent in a lackluster session that saw traders sell in line with Thursday’s global market losses. Friday’s loss cut the debt market’s gains during the week to 6.2 percent on average.

Leading the losers was dollar-denominated Discount paper ARDISCD=RASL, which fell 5.4 percent in over-the-counter trade, according to the ask price.

Local Argentine debt prices fell 60 percent on average last month because of the global financial crisis and a government plan to take over private pension funds, but have recovered slightly in recent sessions due to bargain-hunting.

The peso closed firmer against the dollar on demand for pesos to meet financial commitments, traders said. Trade was light and closely monitored by the central bank, they said.

The peso closed up 0.08 percent at 3.3025/3.305 per dollar ARS=RASL in formal trade between banks where the bank routinely intervenes to buy or sell dollars. In informal trade between foreign exchange houses, as measured by Reuters, it rose 1.49 percent to 3.335/3.345 ARSB=. (Reporting by Walter Bianchi; Writing by Helen Popper; Editing by James Dalgleish)